I’m sure most of youhave heard Democrats touting their wonderful intentions to help foreclosed homeowners — who got loans they could never repay –stay in the house they couldn’t really afford. So all sorts of pressure was put on lenders to “modify” the mortgages they held. Forget the original mortgage contract. Just like employment contracts,private, legally-binding agreements are meaningless when the government doesn’t like them –in this,the new era of responsibility.
How’d that work out? Badly, according to an examination by the federal Office of the Comptroller of the Currency and the Office of Thrift Supervision of nearly 35 million loans. They discovered that a quarter of the modified loans resulted in people owing more moneybecause, as lenders modified the loans, they added fees and past-due interest. And, despite all the hype, turns out only 37 percent of the modifications resulted in payment reductions of more than 10 percent.
And yet, get this. Nine months after modification, another quarter of the loans were right back into default. Even with the help, these people still can’t afford the damn houses –big surprise! Big whoop!
But an Office of Thrift Supervision bureaucrat has a sunny read on these results. Says acting director John Bowman: “The trend toward lowering payments to make home mortgages more affordable…is moving in the right direction.”
Right direction? If you don’t measure the results– only the good intentions– this plan,like everything else liberals come up with,is a roaring success… but the realitysays something else.
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